Victoria Gold Corp.

Victoria Gold Corp.

September 16, 2009 13:09 ET

Victoria Provides Update on Activities Including Advancement of Cove and Eagle Gold Projects

TORONTO, ONTARIO--(Marketwire - Sept. 16, 2009) - Victoria Gold Corp. (TSX VENTURE:VIT) ("Victoria" or the "Company") is pleased to provide a status report on its two main gold assets: the Cove Gold Project ("Cove") and Eagle Gold Project ("Eagle") as well as an update on several of its other gold projects.

Victoria's transformation and growth has been significant over the past twelve months. Highlights include the completion of two major corporate transactions adding a total of 4.4 million ounces of gold that are National Instrument 43-101 ("NI 43-101") compliant to the Company, and successfully completing the Phase 1 drill campaign at the Helen Zone located at Cove in Nevada, USA.

The following table summarizes the global resources of the Company. The technical reports are all available at

Resource Gold Grade Contained
Deposit Category Tonnes (g/t) Ounces Gold

Eagle Gold Project Indicated 98,584,000 0.845 2,678,269
Eagle Gold Project Inferred 2,023,000 0.671 43,642
Big Springs Inferred 13,984,253 2.67 1,195,000
Tassawini Indicated 10,766,600 1.3 436,600
Tassawini Inferred 614,000 1.7 32,500

Chad Williams, President and CEO of Victoria Gold Corp commented, "Through successful exploration and well-timed acquisitions, Victoria has become one of the fastest growing gold companies in its peer group. Our exploration and phased development growth activities are expected to generate important milestones for the Company prior to year end".

Development Projects

A) Nevada: Cove Gold Development Project

The Helen Zone at Cove is a new gold discovery made using the Company's Structural Systematics exploration technique. Helen was the first of fourteen targets drilled on the Cove property so the Company believes that considerable exploration upside remains at Cove. Highlights of recent progress at Cove are as follows:

- Scott Wilson Roscoe Postle Assoc. Inc. has been contracted to complete a 43-101 resource calculation and economic study, plus design and cost an underground exploration and bulk sampling program. This work should be completed by early November. The Nevada office of the United States Bureau of Land Management indicated that the permitting of an advanced underground exploration program for the Helen Zone should take at least six months following completion of this engineering work.

- In conjunction with Scott Wilson, Kappes, Cassidy and Associates have been contracted to conduct a series of metallurgical test programs to determine the best processing option and subsequent gold recovery.

- As part of the input data required for this engineering work, Victoria recently completed a new detailed structural analysis of the Helen Zone. Indications of another nearby intersection zone with similar characteristics to the Helen Zone were discovered during this analysis. Further drilling at Cove may be completed prior to year-end subject to the Company's overall drilling priorities.

Victoria has spent over US$10 million at Cove to date, completing the work commitments to earn a 100% interest in the Cove project, such interest being subject to (i) a back-in right in favour of Newmont Mining Corporation (NYSE:NEM) ("Newmont") for a 51% interest at a cost to Newmont equal to 2.5 times the amount spent on the property by Victoria up to the time of the back-in decision, or (ii) a US$1.5 million cash payment to Newmont and a maximum royalty of up to 5% depending on the prevailing gold price (including previous royalties) upon the delivery of a positive feasibility study completed by Victoria based on a minimum of 500,000 ounces of gold.

B) Yukon: Eagle Gold Development Project

The Eagle Gold Project is located in the Yukon, Canada, a historically significant gold producing region and, in the view of the Company, a favorable mining jurisdiction. Victoria recently purchased this project through the acquisition of StrataGold Corporation ("StrataGold") which closed on June 4, 2009. Eagle is road accessible, has a low strip (waste-to-ore) ratio, and most importantly has attractive metallurgical characteristics that make the deposit amenable to lower cost heap leach processing. Hydroelectric power is also available nearby.

The new pre-feasibility study on Eagle conducted by Scott Wilson Roscoe Postle Assoc. is well underway and it is on track to be completed by year-end.

- A camp has been successfully set up and on-site technical work, including drilling with three rigs plus trenching, is in full progress.

- Representatives from China, the media, and buy-side investors visited Eagle over the past few weeks. Further site visits are planned prior to year-end. (Details can be found at

Exploration Projects

High-impact exploration continues to be a core focus for the Company.

A) Nevada: Santa Fe Gold Exploration Project

Victoria has the right to earn a 70% interest in the Santa Fe gold project from Barrick Gold Corporation by incurring exploration expenses in an aggregate amount of at least US$6.5 million over a six-year period. Cumulative expenditures were approximately US$700,000 prior to the current exploration campaign that began several months ago.

Assay results from diamond drill hole BH-1, the first hole drilled by Victoria at Santa Fe, were received. There is an almost continuously gold mineralized interval from 172 to 375 meters down hole. The best intercept within this interval is 47.6 m starting at a down hole depth of 288.3 m and grading 1.34 g/t of gold (including 20 m grading 2.24 g/t gold). There are two narrow zones of "no core recovery" (321.3 to 321.9 m and 322.5 to 323.1 m) in this broad zone. With the completion of drilling of hole BH-1, Victoria's spending commitments at Santa Fe have been satisfied for 2009. Geologic mapping continues and future work on the property is currently being evaluated relative to the numerous promising exploration projects controlled by Victoria.

B) Project Optimization Activities


Given the rapid increase in the number of gold properties in Victoria's asset portfolio over the past twelve months, certain Nevada exploration properties have recently been rationalized as part of a rigorous property optimization program. This included dropping the Black Canyon and Toiyabe claims. The Relief Canyon claim block has been reduced as well. On the other hand, Victoria continues to evaluate new higher quality projects in the region.


Through its acquisition of Stratagold, Victoria acquired a portfolio of gold projects in Guyana. Recent results from a phase 1 surface sampling program at the BRL joint venture with Newmont Overseas Exploration Limited displayed exploration potential that exceeded the Company's expectations (see July 29, 2009 press release). Currently, follow-up trenching and mapping is being completed by Newmont as the operator on two high-grade anomalous areas. A diamond drill program is planned for the fourth quarter.

To determine how the recent exploration results fit in context within the Company's primary plans of bringing Cove and Eagle to production in a timely manner, Victoria announced the appointment of Paradigm Capital Inc. as advisors several weeks ago. Interested third parties are visiting the Company's Guyanese assets toward the goal of either acquiring some or all of the Company's properties in Guyana or entering into a joint venture with the Company in respect thereof.

Corporate Activities

Annual General Meeting and Personnel Update

The Company held its annual and special meeting (the "Meeting") in Toronto on July 22, 2009. All resolutions put forth at the Meeting were passed, including approval of the stock option plan. All nominated directors were elected at the Meeting and include:

1. T. Sean Harvey, Chairman and member of audit committee
2. Chad Williams, CEO and President
3. John McConnell, Executive VP
4. Hugh Agro, member of audit committee
5. Mike McInnis, member of audit committee
6. Leendert Krol

Victoria is pleased to announce the following appointments:

- Mr. John Goyman as Vice President of Nevada Projects. John has extensive permitting and project development expertise including former postings as Regional Director of the British Columbia Ministry of Mines, Owner's Construction Manager for Newmont Mining Corporation's Hope Bay Project, and Vice President Construction and Operations of Western Keltic Mines Inc.

- Mr. Mark Ayranto as Vice President Corporate Development. Mark comes to Victoria from StrataGold where he held the same position. Mark will be focused on the Company's internal and external growth and asset optimization initiatives. Mark holds a B.Sc. from Dalhousie and a MBA from Royal Roads University and brings over 10 years experience in project and corporate development.

- Mr. Norman Chang as Manager Investor Relations. Norman's background includes 11 years in capital markets with 5 years sell-side equities research experience and 6 years as a buy-side analyst and portfolio manager.

About Victoria

The Company is in a strong position in the current environment with roughly $10 million cash, no debt, a strong exploration and technical team, plus a portfolio of quality gold assets located in premium jurisdictions.

Victoria is a high growth gold company with a focus on adding value per share through efficient exploration, project development, accretive acquisitions and effective marketing. Maintaining a low risk profile through project diversification, sound financial management, and operating in secure jurisdictions are key priorities for Victoria's management team.

The technical contents in this press release were reviewed by Nancy J. Wolverson, Independent Consulting Geologist. She reviewed the analytical results and the QA/QC procedures in place at the facilities of the Company and the analytical laboratory. Ms. Wolverson is a Certified Professional Geologist (C.P. Geo.) through the American Institute of Professional Geologists (AIPG) and is a Qualified Person as defined in National Instrument 43-101. Dr. Raul Madrid, Vice President, Exploration of the Company, directs the drilling and logging procedures and is responsible for the geologic interpretation.

On Behalf of Victoria Gold Corp.

Chad Williams, P. Eng, CEO, President & Director

Cautionary Language and Forward-Looking Statements

This press release includes certain statements that may be deemed "forward-looking statements". All statements in this discussion, other than statements of historical facts, that address future exploration drilling, exploration activities and events or developments that the Company expects, are forward looking statements. Although the Company believes the expectations expressed in such forward looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include metal prices, exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Accordingly, readers should not place undue reliance on forward-looking statements.

This news release and the information contained herein does not constitute an offer of securities for sale in the United States and securities may not be offered or sold in the United States absent registration or exemption from registration.

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